OVER the past few months, we have heard the raging debate over whether employees should be allowed to withdraw their Employees Provident Fund (EPF) savings at age 55 or 60 when they retire.

Many were worried that with the impending amendments to the EPF Act 1991, the government would only allow withdrawals at 60. Although there was no official announcement to this effect, rumours were enough to provoke a heated debate among interested parties, contributors and unions in particular.

By this week however, the situation was made clear. It’s now official. Starting next year, private sector employees can opt to withdraw their full EPF savings at 55 or 60 when they retire.

The EPF Act 1991 would be amended to provide for this regulation, said Human Resources Minister Datuk Dr S Subramaniam.

He clarified that employees who withdrew their EPF savings at 55 would have to continue making contributions until their retirement.

“The EPF, after deliberations with the ministry, has decided that a 30 per cent EPF withdrawal can be made at 50 and the remainder at 55 years of age.

“But those who don’t withdraw their savings at 55 can make a full withdrawal at 60 years of age,” he said.

The amendment is in line with the private sector Minimum Retirement Age Bill 2012, which was passed in parliament in June. The Bill raised the minimum retirement age in the private sector from 55 to 60 years old.

Well, we should all be happy now that the government has cleared the air over the withdrawal issue.

A lot has been said by proponents of a late withdrawal. A columnist in a national daily felt that the decision to give EPF contributors the option to withdraw at either 55 or 60 was a negative move.

“The EPF is complementary to the increase in retirement age to provide for better support in old age. But inexplicably, the decision has been taken to allow contributors to withdraw their life savings in their late 50s even though they will be working until 60.

“That is an ill-considered move, even if the Malaysian Trades Union Congress has been pushing for it, because the EPF by law must consider always its role of providing for the future of its members. The less that is withdrawn before retirement age, the more there is at retirement,” he wrote.

The overriding aim of the Employees’ Provident Fund is to provide for retirement, which favours a later withdrawal date, he added. This may be true but the reality is that many are not in favour of it. They prefer the option which simply means withdrawal at 55.

From the heated exchange over the past few months, it is clear that the majority want to withdraw their EPF savings early.

I dislike the hype that sometimes workers need to be protected against themselves. EPF studies indicate that most workers exhaust their savings within a few years of getting them. So the argument is why give them the savings even while they are working?

Let me say it bluntly, in simple layman’s lingo. EPF is my savings. When and how I intend to use it is my business. Those few blokes sitting high on the EPF Board and earning a fat income from contributors’ hard-earned savings have no right to decide when we wish to withdraw our money or how we intend to use it.

Guess what! EPF paid 6 per cent in dividends last year and shouted out loud that it was the best in 10 years. What? A measly 6 per cent! I think I know how to invest elsewhere and get much more than that. Just give me my money.

Even if I want to indulge in my retirement savings by splashing out on a new car or taking a holiday of a lifetime or renovating my house, that’s my business. Even if I finish all my EPF savings before I kick the bucket, it’s also my business. Even if I have to depend on my children for support in my old age, that’s also my business.

To those in the EPF, let me tell you this. As far as the savings of contributors is concerned, it’s none of your business. Just pay out once contributors are eligible to receive their savings. Don’t ask questions. We have heard enough.

However, what you do with our savings is our business. We have heard of how EPF had lost money in less than savoury investments, such as in bonds and stocks. Add in money speculation. And isn’t it true that our savings were also used in certain bailouts? You keep quiet but we know.

Then, what about employers who defaulted on payments? How many have you nabbed each year? So far, we have only heard that 224 company directors have been blacklisted from travelling overseas for not paying their employees’ monthly contributions from April to June.

Well, at least it’s good to know that EPF is taking action against errant employers but there is a lot more than meets the eye. EPF aims to help people save for retirement but please ensure that monthly contributions are in order. Errant employers must be brought to book and make sure that they repay what they owe their employees.

For the information of all, according to the EPF Act 1991, all workers including permanent, part-time, temporary and probationary, are required to make EPF contributions and have the right to receive contributions from their employers to be paid on or before the 15th of each month.

As contributors, we should check with EPF regularly and not only depend on the annual statement if we have reason to believe that our employer has defaulted. Many workers have been short-changed in this manner.

As a public service, I think my editor at The Borneo Post will be more than happy to publish this. Doubts regarding account information can be addressed by calling EPF’s Call Centre on 03-8922 6000 from 7.30am to 7.30pm on weekdays, or make enquiries online via http://enquiry.kwsp.gov.my.

For investments in unit trust, which is permitted by EPF, members must be advised of the risks involved although the scheme aims to offer them the opportunity to enhance their retirement savings.

Members must take note that although the EPF approves the funds to be offered under the EPF members investment scheme (EPF-MIS), it should not be taken as any indication that the EPF recommends these funds to its members, or provides any assurance of their performance.

Members are strongly advised to understand the objective of the scheme and seek appropriate advice from qualified advisers or financial planners before deciding to participate in it.

I have to concede that I’ve become the doubting Thomas in this scheme. I’m not sure how and why EPF came out with this so-called opportunity for members.

I just hope it’s not an attempt by an influential group out there to make use of EPF funds to make money for themselves.

We all know that EPF is the biggest cash cow around and everyone wants to milk it.

That’s all the more reason why I want my money safely in my own hands … and as soon as possible. – Borneo Post